Using Unsolicited Federal Contract Proposals for Sole Source COVID-19 Related Contract Awards

Blank Rome LLP

Blank Rome LLP

Although firms that offer coronavirus COVID-19 solutions can use many routes to access the federal marketplace, very few of these routes can lead to a sole source contract. One such vehicle is the unsolicited proposal. An unsolicited proposal can result in a sole source contract if the firm’s proposed solution is unique enough to support a Contracting Officer’s sole source Justification and Approval. Recent case law has established that the government has a legal obligation to fairly evaluate unsolicited proposals, so in effect, submission of an unsolicited proposal creates an implied contract with the government that obligates the government to evaluate the firm’s proposal fairly (but not necessarily to award a contract to the firm). Scott v. U.S., No. 17-471C, 2017 WL 4785353 (Fed. Cl. Oct. 24, 2017).

Companies with innovative solutions that have not been the subject of procurement contracts or grants can use this vehicle to offer their goods or services to the federal government on this exclusive basis.

The Federal Acquisition Regulation (“FAR”) defines an unsolicited proposal as a written proposal for a new or innovative idea that is submitted to an agency on the initiative of the offeror for the purpose of obtaining a contract with the Government, and that is not in response to a request for proposals, Broad Agency Announcement, Small Business Innovation Research topic, Small Business Technology Transfer Research topic, Program Research and Development Announcement, or any other Government-initiated solicitation or program. Federal Acquisition Regulation Section 2.101.

Under Far Section 15.603, unsolicited proposals must meet certain characteristics to be eligible for award. The proposal must be:

      • Innovative and unique;
      • Independently originated and developed by the offeror (your company);
      • Prepared without any government supervision, direction, or direct involvement; and
      • Include enough information to help the government customer determine whether or not your proposal would benefit their mission.

With its newly delegated authority under the Defense Production Act (see Defense Production Act: Government Contractor Cheat Sheet), the Department of Health and Human Services (“HHS”) is likely to be on the forefront for awarding competitive and sole source contracts related to COVID-19.

Importantly, to prevent unfair competitive advantages, HHS requires that any unsolicited proposal submitted to that Department contain a warranty by the Proposer that:

      1. The proposal has not been prepared under Government supervision;
      2. The methods and approaches stated in the proposal were developed by this offeror;
      3. Any contact with HHS personnel has been within the limits of appropriate advance guidance set forth in FAR 15.604; and,
      4. No prior commitments were received from HHS personnel regarding acceptance of this proposal.

Because of the extraordinary demand for COVID-19-related solutions and the potential that an unsolicited proposal could result in a very valuable sole source contract, firms in the healthcare solutions space should carefully consider the unsolicited proposal as a valuable tool for business growth.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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